Facts of the Case

The petitioner, Neena Wadhwa, filed a writ petition challenging the notice dated 20.03.2024 issued under Section 148A(b) of the Income-tax Act, 1961, the approval dated 30.03.2024 granted under Section 151, the order dated 30.03.2024 passed under Section 148A(d), and the consequential notice dated 30.03.2024 issued under Section 148 for Assessment Year 2017–18.

The principal ground of challenge was that the reassessment proceedings had been initiated by the Jurisdictional Assessing Officer and not by the Faceless Assessing Officer, which according to the petitioner was contrary to the faceless reassessment scheme.

Issues Involved

Whether reassessment proceedings initiated by the Jurisdictional Assessing Officer are without jurisdiction after introduction of the faceless reassessment scheme, and whether such proceedings are liable to be quashed solely on that ground.

Petitioner’s Arguments

The petitioner, through learned Senior Counsel, contended that initiation of reassessment proceedings by the Jurisdictional Assessing Officer violated the faceless assessment framework. Reliance was placed on contrary views expressed by other High Courts, and it was submitted that the issue arising from the Delhi High Court judgment in TKS Builders Pvt. Ltd. was pending consideration before the Supreme Court.

It was further pointed out that in proceedings before the Supreme Court arising out of PC Jeweller Ltd., liberty had been granted to the Revenue to continue proceedings, subject to non-enforcement of any adverse order.

Respondents’ Arguments

The Revenue submitted that the issue was squarely covered by binding judgments of the Delhi High Court, including TKS Builders Pvt. Ltd. v. ITO Ward 25(3), PC Jeweller Ltd. v. ACIT, and Mehak Jagga v. Income Tax Officer, wherein identical challenges had been rejected. It was argued that in absence of any stay by the Supreme Court, TKS Builders continued to bind the Delhi High Court.

Court Order / Findings

The Delhi High Court noted the fair concession of the petitioner’s Senior Counsel that the issue raised was covered by the judgment in TKS Builders Pvt. Ltd., wherein it had been held that both the Jurisdictional Assessing Officer and the Faceless Assessing Officer have competence to initiate reassessment proceedings.

The Court further observed that identical writ petitions raising the same challenge had already been dismissed by following TKS Builders, including in PC Jeweller Ltd. and Mehak Jagga. In absence of any stay on the judgment in TKS Builders, judicial discipline required the Court to follow the binding precedent.

Important Clarification

The Court clarified that pendency of an issue before the Supreme Court does not dilute the binding nature of a High Court judgment within its territorial jurisdiction unless the judgment is stayed or set aside. Reassessment proceedings initiated by the Jurisdictional Assessing Officer cannot be invalidated solely on the ground of the faceless scheme.

Final Outcome

The writ petition was dismissed. The Delhi High Court upheld the validity of the reassessment proceedings initiated by the Jurisdictional Assessing Officer for Assessment Year 2017–18 and dismissed all pending applications as infructuous, deciding the matter against the petitioner and in favour of the Revenue.

Link for download order- https://www.mytaxexpert.co.in/uploads/1769681864_NEENAWADHWAVsPRINCIPALCOMMISSIONEROFINCOMETAX18ANR..pdf

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